While sentiment in the US Treasury market has calmed somewhat recently, investors should not let their guard down. The yield on the 10-year US Treasury bond is likely to remain above 5%, and may even rise again to 5.25%. The rising yields on long-term US Treasuries will also put pressure on the Eurozone bond market, where the core issue is currently the risk of French sovereign debt. Although there is a possibility of short-term overpricing in the French bond market's spreads, the risks are far from over. The US Treasury market has recently experienced significant volatility. Following the release of US CPI data on Wednesday, buying of Treasury bonds emerged around 5.3%; subsequently, during Asian trading hours, South Korean stocks led a decline in global equity markets, further fueling safe-haven flows into US Treasuries. In fact, there has been sustained demand for US Treasuries over the past few weeks, but this buying has not significantly driven yields down. This is mainly because net short positions in Treasury futures have offset the buying power, and a yield correction was expected long ago. Even with a short-term decline in yields, this does not signify a structural reversal in the bond market; the probability of the 10-year US Treasury yield falling below 5% is very low. The series of economic data released on Thursday had a limited impact on US Treasuries, but the market cannot ignore fundamental signals: initial jobless claims remain low, retail sales data remain robust, and PPI inflation remains high. These fundamentals may become the new pricing basis, pushing long-term yields higher again in the coming weeks until the US midterm elections. Crucially, neither party in the US currently intends to introduce policies to tighten the fiscal deficit, and the two core problems of high inflation and high fiscal deficits remain. Based on a comprehensive assessment of various probabilities, the weakness in long-term US Treasury bonds is likely to continue, with the 10-year US Treasury yield potentially rising back to the 5.25%–5.5% range. Other global bond markets are highly likely to follow suit, experiencing a smaller but consistent widening of spreads. 5.25% can be considered the mean reversion level for yields. Given the continued panic in the bond market, the 10-year US Treasury yield could even surge to 5.5% and remain at that level for several months, potentially extending into the first quarter of 2027. Against the backdrop of overall pressure on global long-term interest rates, the Eurozone bond market is also in a fragile equilibrium, with market attention increasingly focused on internal factors. The French sovereign debt issue has become the core variable influencing sentiment in the Eurozone bond market. While the Eurozone bond market has shown temporary stability, current pricing levels still harbor hidden risks. The most noteworthy change is that the French 10-year swap spread has more than doubled from 60 basis points to 120 basis points; the French-German bond spread has almost reached its highest level since the euro's inception, even exceeding levels before the euro's official launch. The core of market concerns lies in the long-term evolution of French debt and the lack of resolve at the policy level to address the debt problem. The potential political options surrounding the 2028 election further exacerbate these concerns. The current rapid widening of French yield spreads may be due to over-pricing. A rightward shift in French politics could bring tail-end benefits that have not yet been fully priced in by the market. The Italian market serves as a good reference: since Meloni took office, Italian bond yield spreads have steadily improved and have not been significantly dragged down by the French debt crisis. The Italian bond market has shown low volatility sensitivity, which is a positive sign. The initial sharp widening of French yield spreads can be traced back to President Macron's election campaign in mid-2024. At that time, the market briefly calmed down, but the underlying risks did not disappear; the recent surge in yield spreads is a further amplification of pre-existing deep tensions. Therefore, while French bond prices may indeed be overcorrecting, the overall bond market remains in a dangerous range. Similar to the logic in the US market, the possibility of further yield increases is entirely foreseeable.